The National Employment Law Project (NELP) has released new national and state-by-state analyses finding that nearly 1.2 million jobless workers will become ineligible for federal unemployment benefits in March unless Congress extends the unemployment safety net programs from the American Recovery and Reinvestment Act (ARRA). By June, this number will swell to nearly 5 million unemployed workers nationally who will be left without any jobless benefits.

After a two-month reauthorization in December, the critical benefits provided to jobless workers by the ARRA are set to expire at the end of February. In December, the House passed a $154 billon jobs bill, including an extension of the ARRA unemployment provisions; the Senate has yet to propose a jobs bill.

NELP’s national and state-by-state estimates, Workers Losing Federal Unemployment Benefits in 2010 Due to Expiration of the ARRA, are available here.

"Congress must swiftly act to maintain the lifeline for millions of jobless Americans caught in the undertow of record long-term unemployment in this ongoing downturn," said Christine Owens, Executive Director of the National Employment Law Project.

"At the end of last year, Congress wisely agreed that our hardest hit workers and our economy were not yet out of the woods, and reauthorized the jobless benefits and health care subsidies from the ARRA. It is critical for Congress to renew these unemployment provisions through the end of the year before its Presidents Day recess for the millions workers again facing the end of the line - and to avoid missing the boat on this timely and effective economic jolt," said Ms. Owens.

The Congressional Budget Office estimates that UI benefits generate up to $1.90 in GDP per every dollar spent, making the UI provisions the most cost-effective policy for stimulus efforts in 2010. According to the Economic Policy Institute, extending the ARRA’s provisions for the duration of 2010 would generate an additional 800,000 needed jobs, since safety net spending results in greater disposable income for recipients to use on goods and services.

The ARRA, enacted in February 2009, funded a comprehensive set of protections to help unemployed workers throughout the year. A similar approach will be necessary in 2010 as long-term unemployment continues at record levels.

To date, these extensions and supplements have had significant impact. Currently, 5.6 million people are accessing one of the federal extensions (34-53 weeks of Emergency Unemployment Compensation; 13-20 weeks of Extended Benefits, a program normally funded 50 percent by the states).

During the first nine months following the enactment of the Recovery Act (from March – November, 2009), nearly $8.3 billion in additional benefits have been distributed through the $25 weekly supplement.

NELP’s projection is a combined estimate of exhaustions from state-provided benefits and federally-funded extensions. Of the almost 1.2 million workers facing a cut off of benefits in March alone:

• 380,000 workers will exhaust their 26 weeks of state benefits without accessing the temporary EUC extension program or the permanent federal program of Extended Benefits.
   
• Another 814,000 workers will not be eligible to continue receiving EUC past their current tier of benefits.

Though June of this year, nearly 5 million workers will be left without additional EUC benefits, including 1.7 million who will run out of their limited 26 weeks of state unemployment benefits and another 3.3 million who will not be able to collect their full weeks of EUC.

Additionally, when just considering the regular state program alone, at least 5 million workers will run out of their regular state benefits without any federal options available to them – meaning that they can rely on nothing more than their 26 weeks of regular benefits, unless the ARRA is reauthorized.

Long-term unemployment has surpassed the severity of previous recessionary periods: currently, nearly 40% of unemployed Americans— over 6.1 million workers— have been unemployed for six months or longer. By comparison, the previous peak in long-term unemployment was 26 %, in 1983. On average, unemployment now lasts nearly 7 months, an increase of 75 percent since the start of the official start of the recession two years ago.

"Any delay reauthorizing the ARRA will have devastating consequences for both workers and the struggling communities hardest hit by the recession. Starting on February 19th, state agencies that administer unemployment benefits will be forced to notify workers that the program will be shut down by the end of month, as required by federal law. Thus, if Congress doesn’t reauthorize the programs before their recess on February 12th, this deadline will create chaos for the state agencies and workers facing an uncertain future," said Ms. Owens.

For more information on the methodology used to arrive at the estimates presented NELP, please contact Anna Deknatel at anna@berlinrosen.com.  NELP is also available to help identify workers whose benefits are expiring.

Full Release (including Charts) [PDF]